Market Monitor Trends and Breadth September 08 BMO - Wall Street Stumbles as Weak Jobs Report Stirs Recession Fears

[Market Monitor News]
I have to admit, the market gave me whiplash on Friday.

One moment, traders were celebrating the idea of imminent rate cuts. The next, panic set in as the reality sank in: the U.S. economy may be cooling a lot faster than anyone expected.

LABOR MARKET CRACKS SHOW

The August jobs report [https://www.bls.gov/news.release/pdf/empsit.pdf] was a real disappointment. The U.S. added just 22,000 jobs, well below the expected 75,000 and sharply down from July’s revised 79,000.

Even worse, June was restated to show an outright loss of 13,000 jobs, the first monthly decline since the pandemic. Unemployment ticked higher to 4.3%, the highest in four years, while wage growth slowed to 3.7%.

No wonder President Trump was fuming. He lashed out at Fed Chair Jerome “Too Late” Powell for dragging his feet on rate cuts. On his Truth Social platform, Trump also threatened to launch a trade probe [https://finance.yahoo.com/news/trump-threatens-trade-actions-eu-194232715.html] after Brussels slapped Google with a $3.5 billion fine and forced Apple into a $17 billion payment.

MARKETS REACT: RELIEF TURNS TO RECESSION WORRIES

Initially, stocks got a boost as investors priced in Fed easing. Futures markets are now betting with more than 70% certainty on three rate cuts before year-end. Yields fell sharply, with the 10-year Treasury sinking 9 basis points to 4.07%.

But optimism didn’t last. By the closing bell, both U.S. and European equities had given up gains and slipped about half a percent. As eToro strategist Bret Kenwell [https://www.forbes.com/sites/bretkenwell/] put it, there’s a fine line between a “temporary cooling” and a full-blown downturn and markets are starting to fear the latter.

FLIGHT TO SAFETY: GOLD SHINES, DOLLAR SAGS

Gold was the clear winner of the day, soaring to a record $3,655 per ounce. The dollar, by contrast, took a hit, with the euro climbing to $1.173, its highest level this year.

Oil prices also softened. WTI crude dropped 2.5% to $61.87 per barrel as rising U.S. inventories and talk of increased OPEC+ supply weighed on the market.

COMPANY MOVERS: WINNERS AND LOSERS

BROADCOM [https://www.chartmill.com/stock/quote/AVGO] (AVGO | +9.41%): Sparked excitement with $10 billion in new AI orders [https://www.chartmill.com/news/AVGO/Chartmill-34007-Broadcom-Inc-NASDAQAVGO-Reports-Mixed-Q3-FY2025-Earnings-Beats-EPS-but-Misses-Revenue-Estimates], rumored to be from OpenAI. CEO Hock Tan said this will “significantly” boost 2026 revenue prospects.
[avgo daily chart]
TESLA [https://www.chartmill.com/stock/quote/TSLA] (TSLA | +3.64%): Unveiled a new pay package for Elon Musk that could hand him $1 trillion in stock [https://www.benzinga.com/markets/equities/25/09/47540501/tesla-has-quietly-changed-the-meaning-of-fsd-following-elon-musks-1-trillion-pay-package-announc], but only if Tesla achieves “exceptional” milestones. Bold words from the board.
[tsla daily chart]
ALPHABET [https://www.chartmill.com/stock/quote/GOOG/profile] (GOOGL | +1.08%): Shrugged off the EU fine and plans to appeal [https://www.benzinga.com/news/legal/25/09/47538939/europe-slaps-3-5-billion-fine-on-google-donald-trump-says-money-could-instead-go-to-american-investmen].
[googl daily chart]
KENVUE [https://www.chartmill.com/stock/quote/KVUE/profile] (KVUE | -9.35%): Hit hard after reports that U.S. Health Secretary Robert F. Kennedy Jr. may link Tylenol use in pregnancy to autism [https://www.benzinga.com/trading-ideas/movers/25/09/47530456/rfk-jr-to-link-tylenol-use-to-autism-report].
[kvue daily chart]
LULULEMON [https://www.chartmill.com/stock/quote/LULU/profile] (LULU | -18.58%): A brutal day. The yoga apparel maker cut its 2025 outlook [https://www.zacks.com/stock/news/2747704/lululemon-q2-earnings-beat-estimates-stock-tumbles-on-downbeat-view?cid=CS-ZC-FT-analyst_blog%7Cearnings_article-2747704], blaming tariffs and stale U.S. growth. CEO Calvin McDonald admitted the brand had become “too predictable.”
[lulu daily chart] [lulu analyst downgrades]
DOCUSIGN [https://www.chartmill.com/stock/quote/DOCU/profile] (DOCU | +4.75%), UIPATH [https://www.chartmill.com/stock/quote/PATH/profile] (PATH | +5.9%), and BRAZE [https://www.chartmill.com/stock/quote/BRZE/profile] (BRZE | +13.59%): All posted better-than-expected earnings, with AI momentum helping lift guidance.
[docu brze path daily charts]

MY TAKE

Friday’s session was a wake-up call: rate cuts aren’t a magic cure-all. If job growth continues to sputter, investors will have to weigh whether easier policy is a lifeline or simply confirmation that a recession is creeping closer.

For now, gold bugs are partying while equity traders are left wondering whether the Fed is behind the curve yet again.

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Kristoff - ChartMill

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